Inheritance: How to Ensure the Transfer of Your Assets after Death?
Each of us should properly consider what will happen to our assets after death and make arrangements accordingly, especially if we have already accumulated a larger amount of property. Unfortunately, death can strike unexpectedly, so this is not just a problem for retirees or the terminally ill - by then it may be too late. Below, the lawyers of the law firm Lepmets & Nõges explain the basic rules of succession in Estonia, various options for making arrangements, and possible risks.
The rules and procedure for succession are established by the Estonian Law of Succession Act. Succession takes place either in accordance with the deceased's last will and testament or succession contract, or, in the absence of such a declaration, according to the laws of intestate succession. Intestate succession also applies in part when the deceased has not made a last will and testament for all of their property.
The first heirs in the order of intestate succession are your children, the second are your parents and their children (your siblings), and the third are your grandparents and their children (your aunts and uncles). The more distant orders are only taken into account if there are no relatives of closer orders. The spouse inherits equally with the first-order heirs but no less than one-fourth, and along with the second-order heirs, half of the estate. If there are no heirs of the first or second order, the spouse inherits the entire estate, regardless of the existence of third-order heirs.
It should be noted that the intestate heirs are the spouse and relatives in the sense of the Family Law Act. A cohabiting partner is not a spouse and does not inherit anything by law. If someone else is registered as the father of a child in the population register, the child does not inherit from their biological father. In such a case, paternity must be judicially established after death, but since the deadline for challenging paternity is specific and short, it may no longer be possible. Likewise, a child whose biological parent you are not is not your intestate heir, regardless of the fact that you are married to their parent and have fulfilled the role of a proper foster parent throughout your life.
Succession by compulsory portion is similar to intestate succession. The right to claim a compulsory portion belongs to a descendant, parent, or spouse of the deceased if the deceased had an obligation to support them at the time of death, and if the deceased deprived them of their rightful share or left them with a smaller portion than they would have received by intestate succession. The size of the compulsory portion is half of the portion that the heir would have received by intestate succession.
It is possible to disinherit a legal heir from their compulsory portion if they have committed a crime against you or a person close to you, or if they have intentionally and significantly breached their legal obligation to support you. The disinheritance must be stated in the last will and testament, and the reason must also be described, as otherwise the disinheritance is invalid.
A will, as a typical final statement of intention, can be either notarial or domestic.
A notarial will is either notarized or deposited with a notary. The latter is done in a way that the testator brings their final will in a sealed envelope to the notary and confirms that it is their will. A notarial will has no expiration date.
It is also possible to prepare a domestic will. The term may be misleading, as there are specific conditions that apply to a domestic will, and failure to comply with them will render the will invalid.
A domestic will may be a holographic will or signed in the presence of witnesses. A holographic will must be written entirely in the testator's own hand and signed. For a witnessed will, there must be at least two witnesses with active legal capacity who sign the will at the same time. Witnesses must be informed that they are called upon to witness the making of a will, although they are not required to know the contents of the will. A person who stands to benefit from the will or a relative of such a person cannot be a witness.
The date and year of the domestic will must be clearly stated, otherwise the will is null and void. A domestic will also loses its validity if six months have passed since the day it was made and the testator is still alive. A notarial will does not take precedence over a domestic will; the most recent will is the valid one. However, making a domestic will does not invalidate a notarial will, meaning that if a more recent domestic will expires, the previously made notarial will still applies.
A separate type of will is a reciprocal will of spouses, which must be notarized and in which the spouses name each other as heirs or make other provisions for the distribution of their property after their deaths. While a regular will can be revoked at any time, revoking a reciprocal will requires delivering a notarized notice of revocation to the other spouse. Additionally, the validity of one spouse's provisions depends on the validity of the other spouse's provisions. After the death of one spouse, the surviving spouse can only revoke the provisions if they renounce the inheritance granted to them by the reciprocal will.
In summary, it is advisable to prefer a notarial will whenever possible. This reduces the likelihood that the authenticity of the will or the honesty of the witnesses will be questioned. Since the notary must verify and record their observations on the testator's capacity and decision-making ability, this also reduces disputes regarding the testator's possible limited capacity. Additionally, notary fees are not high: at the time of writing this article, they are around 30-40 euros depending on the type of will.
A succession contract is an agreement between the testator and another person, in which the testator designates the other contracting party or another person as their heir or gives them instructions. Unlike a will (including a reciprocal will of spouses), after entering into a succession contract, the testator is bound by their contractual arrangements and cannot unilaterally change or cancel them in most cases.
A succession contract can only be withdrawn in specific cases listed in the Law of Succession Act, such as when the entitled person commits a crime against the testator or violates the testator's maintenance obligation or other agreed obligation. The succession contract can be cancelled by agreement between the parties or if there is some other usual ground for cancellation (such as fraud, error, or violence). If the other party does not agree to cancel the agreement, their consent can be replaced by a court order. However, this requires some exceptional circumstance to be present. For example, in the practice of the Supreme Court, it has been found that the termination of the parties' cohabitation alone is not such a circumstance that would require the heir to give their consent to the cancellation of the succession contract.
Determination of individual obligations and rights
The last will and testament can be more detailed than just a simple distribution of property. The testator can also specify a legacy, a testamentary obligation or a testamentary direction. A legacy does not appoint an heir but gives a specific benefit to someone: for example, the testator may bequeath a flat to their children, but give their partner an indefinite right to use the flat as a legacy. A testamentary obligation is an order that creates an obligation without giving anyone a corresponding right: for example, the obligation to build a monument or take care of a pet. If the person assigned to fulfill the testamentary obligation violates the obligation, then they must transfer their share to other heirs. Finally, a testamentary direction is an order that obligates the estate to be used for a specific purpose: for example, creating and maintaining a scholarship fund.
Do you need a lawyer's help
Notary assistance is sufficient if the will only involves leaving property to two children. Intestate succession according to law is also simple and understandable. On the other hand, from time to time, stories about court disputes over the interpretation, validity, cancellation, or scope of a will appear in the media. When large sums of money are at stake, every point and comma is carefully scrutinized. A lawyer can help you ensure that your wishes are expressed clearly, unambiguously, and that they would be implementable in practice. A lawyer is certainly useful if you want to give specific instructions on how your estate must be used after your death. If you have any questions or problems, feel free to contact the team at Lepmets & Nõges law firm who would be glad to help you.